Banking giant Morgan Stanley sounds the alarm about AI’s impact on the job market, warning that most jobs will see material change, and not all outcomes will be smooth.
In a new installment of the bank’s Thoughts on the Market podcast, global head of Thematic Research Stephen Bird says the firm’s analysis suggests AI will touch virtually every occupation, with some industries facing severe automation pressure as the technology advances.
He says the shift is both disruptive and transformative, urging investors and workers to prepare for rapid restructuring across knowledge work, services and professional sectors.
“And admittedly, AI could be quite disruptive, so we don’t want to sugarcoat that. There’s clearly going to be impacts across many jobs. Our work showed that around 90% of jobs will be impacted in some way.”
Bird says that, over time, AI will interact with nearly every role in the economy, with many workers ultimately benefiting from software that boosts capability rather than simply replacing tasks.
“In the long term, I would guess nearly every job will be impacted in some way. The reason we are more optimistic is that what we see is a range of what we would think of as augmentation, where AI can essentially help you do something much better. It can help you expand your capabilities, and it will result in entirely new jobs.”
He notes that the distribution of risk will vary depending on task composition and data complexity, with some white-collar professions exposed to disruption where automation outpaces augmentation.
“In terms of job losses, one interesting analysis that a lot of investors really focused on that we included in our Future of Work report was the ratio within a job of augmentation to automation. The lower the ratio, the higher the risk of job loss, in the sense that that shows a sign that more of what AI is going to do is going to replace that type of human work.
Examples of that would be in professional services, as I mentioned, you know, one of my former professions, law, would be an example of an area where you could see this. But essentially, tasks that don’t require a lot of proprietary data, require less creativity, those are the types of tasks that are more likely to be automated.”
Bird’s comments come as reports emerged that US firms laid off 153,074 workers, the highest in more than two decades.
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